I don’t need to remind anyone of the significance of this day. The trading world was heavily affected by the events that took place thirteen years ago. Things will never be the same, but we have to continue to move forward.  Please remember those we lost and the families that continue their journey forward without them.

Economic Outlook

All of the sudden the confidence in the slow but steady economic is shaken a bit. Last week’s Employment Situation numbers for August came in much lower than expected, and many observers debated how accurate they were. With the numbers coming in much lower than expectations, market participants are going to pay closer attention to the follow up data and see if there any signs of a trend.

Jobless Claims came out Thursday at 315,000, above the consensus estimate of 300,000. The 315,000 was an increase of 11,000 from the week prior. Continuing claims rose slightly to 2.487 million, but the 4-week average is actually down 15,000 to a new “recovery” low at 2.499. We are all watching and paying close attention to these numbers because the Fed has told us their upcoming decisions will rely heavily on jobs data.

Managing Risk

Since their inception, futures and options on futures have been used to hedge, or manage risk. I remain a bit of a long term bull, but am concerned about the downside risk in the short term. In this case I like using an EOM (end of the month) option in the E-Mini S&P 500.  I like buying the September EOM 1950 put at 10 points ($500.00) or better, in a bearish play. Risk is defined to the cost of entry plus fees and commissions. The puts will expire on September 30, so they will take us through the end of the month. You can use this as a hedge or as trying to take advantage of a sell off.

Webinar

For those interested Walsh Trading is holding our weekly grain webinar today, Thursday September 11th at 3 pm central time hosted by our Senior Grain analyst Tim Hannagan. Tim has been ranked #1 by Reuters and Bloomberg in 2011 and 2012 for his most accurate end of year price predictions for soybeans and corn. Registration is free and if you cannot attend live, a recording will be sent to your email upon signup.

RISK DISCLOSURE: THERE IS A SUBSTANTIAL RISK OF LOSS IN FUTURES AND OPTIONS TRADING.  THIS REPORT IS A SOLICITATION FOR ENTERING A DERIVATIVES TRANSACTION AND ALL TRANSACTIONS INCLUDE A SUBSTANTIAL RISK OF LOSS. THE USE OF A STOP-LOSS ORDER MAY NOT NECESSARILY LIMIT YOUR LOSS TO THE INTENDED AMOUNT.  WHILE CURRENT EVENTS, MARKET ANNOUNCEMENTS AND SEASONAL FACTORS ARE TYPICALLY BUILT INTO FUTURES PRICES, A MOVEMENT IN THE CASH MARKET WOULD NOT NECESSARILY MOVE IN TANDEM WITH THE RELATED FUTURES AND OPTIONS CONTRACTS